Why Almost No One Is Happy About This Week's Balanced Budget Amendment Vote

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The House is set to consider a Balanced Budget Amendment on Thursday, but the vote looks like an empty messaging exercise at best — The Washington Post’s Tory Newmyer called it a pantomime of fiscal concern and Tim Phillips, president of the Koch-funded Americans for Prosperity, dismissed it as “a fig leaf of fiscal responsibility.” Meanwhile, some economists are warning that the legislation, if it were ever enacted, could be “extraordinarily dangerous for the economy.” Here’s a guide to the proposed amendment and the planned show vote:

What It Does: The proposed constitutional amendment, authored by conservative Rep. Bob Goodlatte (R-VA), would prohibit Congress from spending more than the government takes in each fiscal year unless three-fifths of both the House and Senate approve it. The amendment would also require a three-fifths majority in each chamber to raise the debt limit and a majority vote in each chamber to increase revenue (i.e., raise taxes).

Why They’re Voting On It: The House vote is widely seen as a way for conservatives in particular to try to quell anger from activists and voters fired up about increased federal spending now that Congress has passed a massive tax cut and a bipartisan spending bill that, combined, will add $1.6 trillion to the budget deficit over 10 years. House Speaker Paul Ryan reportedly promised the Republican Study Committee, a conservative House caucus, a vote on a balanced-budget amendment in exchange for the group’s support last year on the budget resolution needed to pass the tax cut bill.

Why It Matters: The amendment has virtually no chance of passing since it would require Democratic support in both the House the Senate followed by ratification by three-fourths of the states within seven years. But even as a symbolic gesture, the vote seems hollow at best — and a prototypical example of political hypocrisy at worst, after Republicans voted to cut taxes and increase spending.

What They’re Saying: The amendment has been slammed by critics from across the political spectrum.

Fiscal watchdogs:“To the extent that calls for a balanced budget amendment are a first step toward fiscal discipline, we welcome that conversation,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said in a statement on Tuesday. But she went on to note that Congress has often considered budgets that balance on paper, but lawmakers haven’t lived up to their rhetoric when it mattered most — and Republicans appear likely to skip passing a budget this year after their budget last year allowed for $1.5 trillion in increased deficits. “Anyone supporting a balanced budget amendment should also have a plan to achieve a balanced budget and support efforts to implement such a plan; otherwise, it is not a serious proposal,” MacGuineas said. “We need a budget with a long-term fiscal plan that can be implemented and addresses our unsustainable debt head-on, not more meaningless messaging, delay, and denial.”

Conservatives: Some conservatives have complained that the amendment as written still leaves too much wiggle room for Congress to raise taxes or the debt ceiling. Andrew Roth, vice president of government affairs for the Club for Growth, told USA Today that a balanced budget should be achieved through spending cuts and Jenny Beth Martin, head of the Tea Party Patriots, told the newspaper that the language of the amendment “may not actually prevent overtaxing and overspending.” OtherRepublicans have joined the chorus of critics decrying the vote as an empty sop to voters.

Liberals: Democrats have ripped the proposal as a political stunt and a shameless attempt to force cuts to social safety net programs now that the GOP has cut taxes for the rich.

Economists: Many warn that a balanced budget amendment could foolishly limit the government’s ability to respond to economic downturns or crises. “Putting aside for a moment the chutzpah of House Republicans trying to pass a balanced budget amendment (BBA) just a few months removed from their passage of a $1.5 trillion tax cut that went largely to the richest households and big corporations, the simple fact is that the economic consequences of a balanced budget amendment range from extremely bad to catastrophic,” writes Budget Analyst Hunter Blair of the left-leaning Economic Policy Institute. “The reason for this is that a BBA would amplify any negative economic shock to the economy and would thereby turn run-of-the-mill recessions into disasters.”

As editor in chief, Yuval Rosenberg oversees all aspects of The Fiscal Times' website and email newsletter. His writing has appeared in publications including BusinessWeek, CNBC.com, CNNMoney.com, Fast Company, Fortune, Newsweek, Money and Time.